ASIC acts on alleged ‘pump & dump’ scheme

The Australian Securities and Investments Commission ASIC) has sent a message over it preparedness to act against so-called “pump and dump” activity in Australia.

The regulator announced that four people have been criminally charged for their alleged involvement in a coordinated scheme to pump up shares in Australian stock values before dumping them at inflated prices.

Syed Yusuf, Larissa Quinlan, Emma Summer, and Kurt Stuart were charged in the Downing Centre Local Court with conspiracy to commit market rigging and false trading, to artificially increase the price of Australian shares before dumping them.

They face a maximum penalty of 15 years’ imprisonment and a fine of over $1million for market manipulation.

ASIC alleges that in an organised operation the defendants formed a private group on the Telegram app where they discussed and selected penny stocks to announce to the public Telegram group named the ‘ASX Pump and Dump Group.’

The defendants have also been charged with dealing with the proceeds of crime in relation to the money that they each obtained from selling the shares subject of the pump and dump activity.

Commenting on the move, ASIC Chair Joe Longo said, “Market manipulation is illegal. Pump and dump schemes are a form of financial fraud, eroding investor wealth, threatening the integrity of our markets and potentially the Australian economy more broadly.

‘Upholding the integrity of our Australia’s financial markets is a priority for ASIC,” he said.